Shares of beleaguered electronics firm Sharp continued to fall today as Foxconn parent Hon Hai said it was still taking the agreed stake in the firm, but it wanted a lower price.

Sharp announced a massive billion-yen net loss for the second quarter on Friday and said it now expected the loss for the full financial year to balloon from ¥30bn (£245m, $383m) to a whopping ¥250bn (£2.04bn, $3.19bn).

The news sent shares in the Japanese company falling, from ¥267 (£2.18, $3.41) at the end of Thursday to ¥192 (£1.57, $2.45) by the close of trading on Friday. The stock's slide continued today, losing a further 11 per cent to ¥181 (£1.48, $2.31), as Hon Hai announced that it had renegotiated its deal with the firm.

Taiwanese Hon Hai had previously agreed to hand over ¥66.9bn (£547m, $853.8) for a 9.9 per cent stake in Sharp and another ¥66bn (£539.58m, $842.3m) for a 46.5 per cent stake in Sharp's joint venture telly business with Sony.

But the figure is now extremely generous at Sharp's new stock price, the lowest it has ever been for the company.

Hon Hai told the Taiwanese stock exchange today that it was negotiating a new agreement with Sharp.

"Due to the current price volatility of Sharp shares, Foxconn will not be required to fulfil its subscription obligations in accordance with the agreement between the two companies announced on March 27, 2012," Hon Hai said.

"However, both companies have also agreed that the proportion of the subscription rights previously granted to Foxconn will remain unchanged and that the previously announced joint projects will not be affected."

However, Sharp said in a brief statement (translated) that there were no plans to review the details of the contract with Hon Hai.

The Taiwanese firm wants to renegotiate the price for the 9.9 per cent stake in Sharp, an offer that it might not be able to refuse.

The deal with Hon Hai was supposed to give Sharp some much-needed funds to continue its efforts at restructuring. With its stock falling, the Japanese firm is likely to find it difficult to raise cash elsewhere, getting it into more trouble, making it harder to get loans, starting the vicious circle that leads to bankruptcy.

Sharp said on Friday that it would be letting 5,000 employees go to try to save some money, but the move is unlikely to be enough on its own to change the firm's fortunes. ®